And in the U.S. a nine-day sell off. The Dow creeps closer to its largest slump in 33 years.

I'm Max Foster. This is QUEST MEANS BUSINESS.

Hello to you.

Silvio Berlusconi has broken his silence, finally admitting that Italy is facing a crisis. On a day that Italian bond yields hit a record high, the prime minister urged lawmakers to act without panic to overcome the situation. He insists that Italy has solid financial foundations and that the current crisis has more to with confidence than cash.

(BEGIN VIDEO CLIP)

SILVIO BERLUSCONI, PRIME MINISTER OF ITALY (through translator): It is clear to everyone that the emergency that we had to tackle recently is the direct consequence of a confidence crisis that has hit the international markets, uncertainty-uncertainty regarding the euro and uncertainty regarding the financial speculation. This crisis needs to be tackled with determination, without any panic, in order not to worsen the situation.

(END VIDEO CLIP)

FOSTER: Well, earlier today this man, Italian economy minister, Julio Tremonti, met with Euro Group President Jean-Claude Juncker, to discuss the country's mounting debt. Italy has an austerity plan to put its budget back on track by 2014. But there are doubts over the government's commitment to implement the cuts. Italy's financial troubles threaten the stability of the entire Eurozone. It is the third largest economy in the bloc and makes the economy of bailout recipients, Portugal, Ireland, and Greece, look like small change, really. It is actually twice as big as those three economies combined. And Europe will need deep pockets if it is going to bail it out. Its debt to GDP ratio is 120 percent, double the Eurozone limit.

Earlier today yields on 10-year Italian bonds rose above 6.25 percent. That is a record for Italy during euro era. They have now eased around 6.1 percent. And that interest rate is not as high, that Italy-so high that now Italy is teetering on being priced out of the open bond market. When the bond yields became unsustainable, the is when a country needs outside help to fund itself.

It is not just the bond markets that investors are shying away from right now. Milan's main stock index, the FTSE MIB closed at a 27-month low this Wednesday. It has lost 24 percent in the past six months alone.

CNN's Jim Boulden joins me now.

I know, Jim, you are watching Berlusconi speak today. So what stood out for you, from that?

JIM BOULDEN, CNN FINANCIAL CORRESPONDENT: Well, interestingly, you know, finally we have heard from him, as you said, the markets have been waiting to hear what he had to say. I didn't hear anything radically new. Or some people thought that he would announce another austerity package, of maybe push up the austerity package to be before 2013, 2014. Nothing like that.

And as you said, he admitted that there is a crisis of confidence. I think that was important for people to hear. But again, he said solid economic fundamentals. He said the banks have liquidity. And they are solvent. You know, interestingly, he was kind of defiant, I think. I think that is what he wanted to say. Let's hear some of this now.

(BEGIN VIDEO CLIP)

BERLUSCONI (through translator): We need to free further resources, together with the cooperation of private investors. It is therefore paramount that government and parliament implement a new fiscal policy more favorable to households, businesses and the country.

(END VIDEO CLIP)

BOULDEN: So he is saying to the parliamentarians, you know, obviously we already passed this measure, we passed it very quickly. I'm not sure he was speaking to them as much as he was speaking investors, to the rest of Europe, to speculators, by saying, you know, our deficit will be below 4 percent. We will have a balanced budget in a couple of year's time. We are not like the other countries. And that was one of the points he wanted to make.

FOSTER: It is such a big economy, isn't it? And they have got plans in place, but the problem is those plans haven't proved anything to the markets. So, they have got to come up with more, right? Otherwise from past experience, with this Eurozone crisis, you have to do more.

BOULDEN: Well, that is what people were thinking. Would he say there is going to be more? And what he did say was there is going to be more money for the south, he announced that today. So, for the poorer south, infrastructure and things to try and stimulate the economy. He said politicians' pay might be looked at. They might look at cutting some of that. And he was booed a few times. And one time he said, look, it is time for us to roll up our sleeves, and reminded-he reminded the parliamentarians that he is a business man. Let's hear that one.

(BEGIN VIDEO CLIP)

BERLUSCONI (through translator): You are listening to a businessman, who has three companies on the stock market. And therefore, is ready to fight, and is aware-well, aware of what happens in the financial markets.

(END VIDEO CLIP)

BOULDEN: So, if anybody was thinking he might talk about the end of his career, that certainly didn't come up today.

FOSTER: People have written him off too many times. Can't write him off, can you?

(LAUGHTER)

Isn't it in the back of Berlusconi's mind also, that actually the European Union can't afford to bailout Italy. So, he has got to take responsibility for this. He can't rely on Brussels.

BOULDEN: Except he mentioned a lot of the Brussels leaders today. He mentioned a lot of the European leaders. He said, you know there have been talks going on. I talked to Mr. Van Rumpuy today. He said everybody backs our plan, and he wanted to remind everybody. We have a plan. We are implementing that plan. Maybe not as quickly as some people want to see. But you are right, I mean, obviously Italy would be too big to bail out. But we are a long way from that happening, anyway.

FOSTER: OK, Jim, thank you very much indeed.

Well, Andrea Rebusco is head of trading services at the Italy IG Markets. And he joins us now from London.

Thank you so much for joining us.

Thank you so much for joining us. How eminent are Italy's loan needs? Are they OK for cash right now?

ANDREA REBUSCO, HEAD OF TRADING SERVICES, IG MARKETS: Well, we don't really see like a short-term problem regarding our debt market. To be honest what we are seeing in the last few sessions is like a self- fulfilling loss of confidence. And I agree that is important, but if you look at our average, maturities for the debt, it is basically seven years. It is true that we have gotten a massive amount of debt outstanding. It is equal to 120 percent of our GDP. We have 1.9 billion euro, but still the average maturity is seven years. So, if I would focus, I would focus more on growth rather than worrying about the short-term problem about Italy.

FOSTER: But these debt yields we have been talking about, these bond yields, and the way they have been creeping up. Everyone is watching that. It affects confidence, doesn't it? So at what point do you get concerned by those figures?

REBUSCO: Well, certainly they are affecting, now, our economy. We saw like reaching the 6 percent level on the 10-year yield. And they didn't reach 7 percent. Hopefully they won't reach that level. But if you look at other countries, from periphery countries, European countries, we look at Ireland, and then Greece. We see that when they-that their 10-year bond market reached 6 percent, went over 6 percent, they had like a couple of months before they had been paid out. I don't think that is the case for Italy, because as I was saying, we have got much longer maturities. But in a way, I think it is quite worrying, because the cost of funding is too high for Italy to stimulate growth in the next few years, at this level of funding.

FOSTER: But it is the same old story, isn't it? We talk about this every time. Ireland, Greece, Portugal, it is the same old story. But now, Italy, twice the size of all those economies combined. The Eurozone can't afford, immediately, to bail them out. So couldn't things unravel in Italy much more quickly than those other countries who can fall back on Brussels?

REBUSCO: No, I don't think so, to be honest. We have got a different situation from those countries that I mentioned before. If you look at our deficit it is not as high. It is actually lower than the one than like in the U.S. and in the United Kingdom, as well.

FOSTER: But we have learned already, haven't we, the confidence in the markets is what matters, not the basic economics that we keep referring to. It is about confidence and people loosing confidence.

REBUSCO: Certainly, but we are pretty sure that the politicians will do what is necessary in the next few days. And they have to send a clear message. To be honest, what we witnessed (ph) today, like the speech of our Prime Minister Silvio Berlusconi, is like more words (ph) and something that we already know. Our banks are stable, yes, we know they are well capitalized, but what we need and what my country needs is more like structural reforms to stimulate and improve productivity. That is something that we really need. And I think it is something that the market will appreciate.

FOSTER: OK, Andrea, thank you very much for joining us.

As I mentioned earlier, Milan's main stock index fell to a 27-month low this Wednesday. Other major indices across Europe also fell. Let's have a look at the mining shares, because they were amongst the worst performers. Not specifically, let's look at those main markets, but mining shares really did affect things. Shell was down 4.5 percent in London. And the steel producer ThyssenKrupp down almost 4.5 percent in Frankfurt. Societe Generale was the biggest looser in Paris, down nearly 9 percent. We'll talk a bit more about that later on. But it is basically down to a profit warning due to Greek exposure

After the debt deal back to reality. It is another bad news day for the U.S. economy. We'll take you to Wall Street in just a moment for a bit more bad news.

(COMMERCIAL BREAK)

FOSTER: The Dow is down for a ninth straight day; Alison Kosik at the New York Stock Exchange with the very latest on that.

Because we have to go back to 1978 or something, don't we, for these sorts of runs?

ALISON KOSIK, CNN FINANCIAL CORRESPONDENT: Exactly. That is if the Dow ends down today for a ninth time. But you know what, the Dow has definitely recovered from what we saw earlier in the session, where it was down as much as 130 points. We are seeing a little bit of a recovery in the markets, because the White House coming out of its afternoon news conference today and saying it does not believe the U.S. economy is in danger of a double dip recession. But still, you know what, investors are still on edge about where the economy is headed. And it is kind of like a situation of pick your poison about what is worrying investors. For one, it is the U.S. downgrade-the possibility of a U.S. downgrade-that has investors on edge.

Fitch and Moody's said the U.S. can keep its AAA credit rating, but Moody's did lower its outlook on U.S. debt to negative. And Standard & Poor's has yet to weigh in. You have to remember S&P originally said it was looking for $4 trillion in deficit savings. But that debt deal that was signed into law only cuts half of that. So a downgrade is still a possibility.

And then, of course, what else is worrying investors? The weak economic data that continues to come in on consumer spending, on the manufacturing sector, on the service sector, on GDP; GDP especially not showing-not growing enough to create jobs. And of course, jobs is also in focus here on Wall Street. The big jobs report coming out on Friday.

FOSTER: I presume there are a few traders, aren't there, waiting in the wings, looking for some bargains. There are more and more bargains appearing everyday aren't there?

KOSIK: Oh, there definitely are. You are looking at a host of beaten down stocks. And as soon as we saw stocks recover a bit and see more green on the screen, you are seeing investors buy back in and buy back those sort of bargain stocks and that is exactly what is going on right now.

FOSTER: Alison, thank you so much for that.

Well, bad news on the jobs front comes as no surprise to Wall Street these days. And today they got some more as Alison was suggesting there.

Let's go back to New York now and speak to Poppy Harlow, who has been going through those numbers for us.

Did they surprise you, Poppy?

POPPY HARLOW, CNNMONEY CORRESPONDENT: They certainly did, what we saw, Max-excuse me-in this report out from Challenger, Gray & Christmas, that we get every single months, is that we saw 60 percent jump in the announced job cuts in the month of July alone, for big corporations, government jobs, etc cetera. Up to over 66,000, so a very big increase. This comes at a time when the economy is in such peril. The market has been hit so hard for the last eight days. So it comes at a very inconvenient time, if you will. And the reasoning behind it is twofold. One, a lack of demand that we continue to see consumers continuing to pull back; the other is companies continuing to say that they are uncomfortable in this regulatory environment. Health care reform, Wall Street reform, they don't know how it will play out for them as a company. So they are holding their cash rather than spending it on hiring.

I spoke to John Challenger who issues this jobs report every month. I want you to take a quick listen to how he explained it.

(BEGIN VIDEO CLIP)

JOHN CHALLENGER, CEO, CHALLENGER, GRAY & CHRISTMAS: One picture is we are in this rocky recovery and we just in one of those retrenchments. But there is increasing concern that the economy may be heading towards recession. Major companies are now making layoffs rather than just holding onto their people. All of the government stimulus, both fiscal and monetary, now is at risk. Maybe there is just not going to be enough consumer and business spending to keep this economy afloat.

(END VIDEO CLIP)

HARLOW: And I think the key words in that statement were that there is increasing risk that the U.S. economy is falling into recession. You heard Larry Summers saying this morning, if there is not a big shift in demand, Max, we have a one in three chance at this point, he believes, of the U.S. economy falling into another recession. And you are seeing it played out across major corporations. I want to show you three big U.S. companies that have just issued mass layoffs.

Let's take a look first at Borders. They are closing down, so over 10,000 job cuts coming at Borders. Goldman Sachs, that Wall Street powerhouse, announcing a 1,000 layoffs in July to save $1. 2 billion. Then you also have Cisco, that technology giant, cutting 6,500 jobs. So part that is very hard to swallow here, is that these aren't just job cuts coming in one sector, Max. They are coming across the board from finance to retail to technology, Max.

FOSTER: OK. Poppy, thank you very much, indeed.

As investors try to make sense of the global economy banks have been reporting their earnings all this week. And two more to keep you updated on. Tonight, Standard Chartered posted some encouraging growth numbers. Pretty spectacular in places, a 17 percent rise in profits for the first half of the year. That was better than analysts had been expecting although there were some clouds to go with the silver lining. Operations in India struggled with a 39 percent fall in profits there.

The worries are even bigger for France's SocGen. It looks on course to miss its profit expectations for the year after a second quarter it would rather forget. A near 20 percent fall in profits Soc Gen shares fell almost 9 percent in Paris. They are trading at their lowest point since April 2009.

SocGen's exposure to Greek debt and the haircut it is expected to take on those bonds is one of the biggest challenges facing the bank. Earlier I asked Louise Cooper the market analyst at BGC Partners, here in London, how she saw that affecting the banking sector.

(BEGIN VIDEOTAPE)

LOUISE COOPER, MARKET ANALYST, BGC PARTNERS: And it is extraordinary. We all knew that the French banks had massive exposure to Greek sovereign debt. And yet we had results yesterday from BNP Paribas, and today from Societe Generale, and both of them have cause for share prices to fall quite substantially on the back of their exposure to Greece. So, SocGen, today, the share price down 9 percent. Now, this France's second largest bank, a 9 percent share price move is really pretty dramatic. They have announced a 395 million euro write down on their Greek sovereign debt. That is about 15 percent off the entire value of Greek sovereign debt, what many would say is that that is not enough. There could be more write downs to come. So big impact on SocGen share price today, impact on BNP Paribas yesterday, I'm afraid it is not looking good for French banks.

FOSTER: You have alluded to it, but they are talking about how they are not going to, basically be able to meet any of their targets. So it is going to get worse from here, rather than better. Right? You are just trying to work out what the costs will be to these banks?

COOPER: Yes, SocGen said they had expected a 6 billion euro profit for 2012, that now is overly optimistic. So effectively they have given us a profit warning for next year. So difficult trading for banks everything I hear from the trading floor here at BGC is indicative of the same, that banks are very reluctant to put on positions. Banks are very nervous and funding for banks is quite difficult. Getting other investors to lend them money, both short-term and long-term, proving problematic. I'm afraid that the worries about the European banking sector have not gone away.

FOSTER: Meanwhile, some probably quite smug characters over at one of the banks here in London is Standard Chartered. And they have released extraordinary results, haven't they? But basically because they are not exposed, but is that strategy or luck?

COOPER: I look at these results and I'm thinking, is this a bank? No, it can't be a bank. I mean, pre-tax profits up 17 percent, $3.63 billion. They surprised on the upside. They have beaten analysts forecasts. That doesn't sound like a bank. They are talking lending up 22 percent. Deposits up 19 percent, the dividend is up. This can't be a bank. Well, I tell you what. It is a bank but it is not exposed to Europe and the U.S. very much. Standard Chartered may be quoted in London, but it is an emerging market bank. It is based predominantly in Asia, and as we know Asia is booming.

So very, very good numbers for Standard Chartered, the share price was up this morning at the top of the FTSE 100 leader board. It is now actually down a little bit, down about 1 percent. It is an expensive share price. It is an expensive stock. But essentially a lot of fund managers think it is worthwhile paying up for that quality because it is not scary. It is not going to come up with scary numbers and lead to an implosion. So, I'm afraid quality does cost and Standard Chartered is quality.

(END VIDEOTAPE)

FOSTER: There you are.

Coming up, location, location, location, Havana style. For the first time in 50 years Cubans will be allowed to do something that has been against the law, until now.

(COMMERCIAL BREAK)

FOSTER: Private property is making a comeback in Communist Cuba. Banded for decades after Fidel Castro's 1959 revolution, the government is changing the law so Cubans can buy and sell their own homes. And as Shasta Darlington reports it could open new doors for people who have lived for some odd restrictions all their lives.

(BEGIN VIDEOTAPE)

SHASTA DARLINGTON, CNN INTERNATIONAL CORRESPONDENT (voice over): Olivia and her sister have shared this house since childhood, and still do now that they are married with kids-grown kids of their own. After all, they didn't have much choice. Here in Cuba you may own your home, but you are not allowed to sell it.

"We're happy here," she says. "The problem is the kids. They are now in their 20s and they want their own rooms. They want privacy."

Olivia's family has started the long and bureaucratic process of a house swap. They'll trade their large home for property of equal value; in this case, two smaller apartments, the only thing allowed under Cuban law. Until now: Just this week Cuba's national assembly approved a plan to enact a new law permitting the sale of real estate. Owners will need a simply notary stamp. And, of course, pay taxes.

The announcement was applauded. The law is expected to go into effect by the end of the year. Part of a major overhaul of the creaking economy.

(On camera): This is an island with 11 million people and yet there is a housing shortage of almost half a million homes. And the houses that do exist are often decrepit.

(Voice over): It is not unusual to find three or even four generations crammed into a small apartment. Or a divorced couples under the same roof.

In Havana, Cubans come to this improvised real estate market when they want to move. Pen and paper in hand, mingle with other homeowners looking for a trade. Although it is illegal plenty of money is paid under the table. And as many as half a dozen properties can be involved in each tangled swap.

Angel (ph) is a middle man helping buyers meet sellers.

"In Cuba we know how to live within the law, and outside the law," he says. "That isn't going to change."

But Theresa, who wants to find a bigger place, says new legislation would be welcome.

"It will help get rid of all bureaucracy," she says.

Restrictions will apply. Cubans will only be allowed to own one home and Cuban Americans are welcome to send cash, but can't hold the deed.

Shasta Darlington, CNN, Havana.

(END VIDEOTAPE)

FOSTER: Egypt's former president appeared in a Cairo courtroom today. And it was quite a sight to behold. And up next we take a closer look at how the spring awakening is affecting Egypt's economy.

(COMMERCIAL BREAK)

FOSTER: Welcome back. I'm Max Foster. You are watching QUEST MEANS BUSINESS. Time for an update of the news headlines this hour.

(NEWSBREAK)

FOSTER: Hosni Mubarak seem nearly invincible until the revolution that ended his 30 years in power earlier this year. His appearance in a Cairo courtroom on Wednesday brought a stunning contrast many Egyptians must have thought they'd never see. The 83-year-old was carried in on a stretcher that was surrounded by bars. He denied the charges against him, including ordering the killing of protestors during the revolt. CNN's Fred Pleitgen is in Cairo.

And Fred, we knew it was going to be a spectacle. But really this was incredible, wasn't it?

FRED PLEITGEN, CNN INTERNATIONAL CORRESPONDENT: Well, it certainly was incredible especially in light of the fact that we didn't know until pretty much the last moment whether or not Hosni Mubarak was actually going to appear in the courtroom. Certainly there were a lot of people here in Egypt who, only a few days ago, only a few hours before he actually got there would have not expected him to actually have to stand trail in that Cairo courtroom.

And I can tell you the mood when he was wheeled into the courtroom was really one of almost deafening silence as people here, for the first time since he was toppled about five months ago, saw their former leader. And then in that very frail state it was not just the fact that he was looking very weak. It was not just the fact that he was having to lie down, he was having to have people tend to him the whole time. It was also the fact that the very few things he did say, and all he really said was that he denied the charges against him, his voice sounded very, very weak.

So I spoke to a couple of lawyers for the prosecution while I was inside the courtroom. And they said even though They're asking for the death sentence against Hosni Mubarak, they were still absolutely devastated to see him in that state.

That's certainly the same thing that many people watching this trial around Egypt will have felt, whether they were for or against Hosni Mubarak. This is still an icon, really, of this country, and someone who seemed larger than life for such a very long time -- Max.

FOSTER: Yes, it really is about how the -- how the mighty have fallen, isn't it?

But where are we, technically, then, within the trial?

Where does it go now?

PLEITGEN: Well, that's a very good question. Essentially, what happened today is that -- that charge was read out to the lawyers. The lawyers then filed all sorts of petitions, lawyers from both sides, petitions, motions to bring in other defendants, to bring in other people to be prosecuted, to let other people in that courtroom, as well.

The trial has now been adjourned, but only part of it. So what's going to happen is that tomorrow, the trial is going to continue, but only with the interior minister and some of his closest associates being on trial. And Hosni Mubarak, the next time we're going to see him is going to be on August 15th, when he is set to stand trial again, this time him and his two sons, Gamal and Allah Mubarak, are going to be on trial.

So it seems as though the proceedings could last a little longer than many people had thought. Originally, the Egyptian justice authorities were saying they wanted to do this in a speedy way. But certainly it appears as though it could take several month -- several months before there's a verdict. And one of the things, of course, people are worried about is whether or not Mubarak will actually live to see that verdict -- Max.

FOSTER: OK, and, Frederik, if you could, just explain who's running Egypt right now and what's going to happen about elections and having a more stable system going ahead.

PLEITGEN: Well, that's certainly one of the things that -- that the people who are running this country are -- are trying to put in place at this point. It's a military council, the Supreme Council of the Armed Forces here, essentially a council of several army generals who are running the country, people who were actually hand-picked by Hosni Mubarak and who are very, very close to him, as well. That's something that hasn't gone done well with some people here.

But by and large, the support of the military by the population still seems to be very large.

The next thing that they want to do is parliamentary elections. The - - the process for that is going to start in late September. The actual elections probably won't be until November. Then, at some point, they're going to draft a constitution. It's still uncertain whether or not that's going to be before or after these parliamentary elections. And then probably some time in the end part of next year, you're going to see you're going to see new parliamentary elections with a new president to follow Hosni Mubarak then taking office shortly after that.

It's a very long process. There's fundamental changes that people want. And certainly these are very tumultuous times in Egypt's history -- Max.

FOSTER: OK, Fred, thank you very much, indeed, for bringing us all of that -- that background on the story.

So -- so what impact has the revolution actually had on Egypt's economy, then?

Well, a little earlier, I put that question to CNN's John Defterios.

(BEGIN VIDEO TAPE)

JOHN DEFTERIOS, HOST, "MARKETPLACE MIDDLE EAST": Well, people don't like to see uncertainty and this whole movement from January to July is a great deal of uncertainty, one giant question mark over the economy. And it's had an impact, Max. Through the January to March quarter, the economy contracted 4.2 percent. The fiscal year finished at the end of July, so the final numbers aren't out yet. But the expectation is, for the year, the economy grew 1.2 percent.

The year before, it grew just over 5 percent. So that period, by the end of 2010 to the end of the first quarter of 2011 on calendar terms, the economy contracted 9 percent in terms of a shift.

So it's been quite a shock, because the uprisings' first, very high expectations of the youth. But the foreign direct investors and the tourists stayed away from the country. So it's been a -- a grand shock to the economy.

FOSTER: Take (AUDIO GAP) as well as the investment not going in anymore?

DEFTERIOS: Yes, there's an alarmingly sharp drop in foreign direct investment in that January to March period. In fact, there was net outflow.

So FDI dropped 124 percent, with nearly $2 billion flying out of the country.

But I think it's important to note that this is an economy that was sucking in capital for five years before that, 2005 to 2010. It brought in nearly $50 billion. In fact, a very had -- very high rankings within the world bank surveys of doing business and the rest.

That five year window of reforms was fantastic.

But -- the big question mark here -- it didn't trickle down fast enough, so the poverty rate still is very high, one out of five you need the poverty line.

Number two, the question mark was, why did President Mubarak wait 25 years to put forward the reforms?

It was only in that last five year window. And the youth unemployment at better than 20 percent created all that frustration.

FOSTER: So let's try and be a bit positive and work out how you can take out some uncertainty or what the government can do to give some certainty back to those investors.

DEFTERIOS: Sure. No, I call it the staircase to reform, but it includes constitutional reform, political reform and economic reform. And they have to happen in that sort of order here.

So constitutional reform leading to parliamentary elections in November, parliamentary elections in -- in 2012.

But some huge question marks. For example, this government decided to -- to turn down the IMF loan of $3 billion that was on offer for political reasons. The Muslim Brotherhood, for example, is trying to introduce a payroll tax of 2.5 percent on Muslims to make their contribution in society. It hasn't passed, but again, that's quite a tax, 2.5 percent.

And then, when there was unrest in the Square again -- and you saw this in the last three weeks in Tahrir Square -- this government decided to sack half the cabinet. So it was like a knee-jerk reaction. And again, that's not clarity.

So if you can move and say that's the past, we see that Mubarak is on trial, if you move to constitutional reform, elections and then the foreign direct investment and tourism comes back in, this could be the staircase to prosperity in the next six months.

FOSTER: John Defterios there.

Now, they've taken down credit cards, newspapers -- now hackers hit the world -- or the heart of the world's government. And the suspect's identity might surprise you this time, though. We'll explain why this might be the biggest hack yet after the break.

(COMMERCIAL BREAK)

FOSTER: It's been called the biggest transfer of wealth in history, but it's not a merger or an acquisition, it is a computer hack. And one of the most powerful nations in the world may be behind it.

They're calling it Operation Shady Rat. And rat, in this case, stands for remote access tool.

Over the past five years, McAfee says government systems in the United States, Canada, India, South Korea and Taiwan have all been compromised. The United Nations has also been targeted, as have American defense contractors and the International Olympic Committee.

So, what was actually taken and how sensitive was it?

Well, it was mainly military information that the hackers seemed to be interested in, specifically, e-mail exchanges, schematics and negotiation documents. According to McAfee's vice president of threat research, if you're talking in terms of intellectual property, this is the biggest transfer of wealth in history.

This is not the work of an Anonymous or other grassroots movement. The report says the culprit is another country. It's not officially saying who, but all the fingers are pointing in one direction and that is China.

Analysts say this has all the hallmarks of a Chinese operation and the targets match up with China's intelligence priorities.

Earlier I spoke to Dmitri Alperovitch.

He is the vice president of threat research at McAfee.

And I asked him to tell me what he thought was most surprising, in terms of details, from Operation Shady Rat.

(BEGIN VIDEOTAPE)

DMITRI ALPEROVITCH, VICE PRESIDENT OF THREAT RESEARCH, MCAFEE: The real shock has been the magnitude and scale of these attacks. It's not that there are interesting tidbits in there, such as the compromises at the U.N. or the International Olympic Committee or the World Anti-Doping Agency, but the fact that every sector of the economy, from real estate, from IT, from construction and heavy industry, from satellite communications, pretty much anything you can think of is being compromised and very valuable, very sensitive intellectual property trade secrets are being stolen from these companies.

So, effectively, all of the money they're investing into R&D, into research and development, is being leveraged by others to steal that valuable information and potentially recreate it somewhere else.

FOSTER: It does have value, of course. But I know that you're suggesting this project could only have been carried out with the backing of a national government.

So what sort of evidence have you got for that?

ALPEROVITCH: So, it's not just based on the scale and magnitude of the operation, but the specific intelligence that we're after. It's not just economic in nature, it's political, it's military. So going after sensitive military secrets and defense contractors, going after the United Nations, going after the ASEAN forum of Southeast Asian nations, the World Anti-Doping Agency. You really have no economic or cyber crime motivation to penetrate those organizations, but certainly plenty of nation states would be interested in getting access to that data.

FOSTER: So where are you pointing the finger?

What's most logical?

ALPEROVITCH: We're actually not pointing a finger. So while we believe it's a nation-state, we don't believe it's our job to point fingers. So we'll leave that up to others and hopefully governments will be able to investigate this and come up with an accurate attribution.

FOSTER: You know why I'm asking you, because China keeps coming up.

ALPEROVITCH: I understand others are saying that publicly in the press. We're not. We're not pointing fingers.

FOSTER: Is there any technical information that might suggest it's from China, though, without just looking at the strategy, as it were?

ALPEROVITCH: Not that I'm aware of that's openly available.

(END VIDEO TAPE)

FOSTER: But has he got the information?

We wonder.

There is nothing like high spirits at work, meanwhile. And this man has plenty of them. We'll look at his World At Work next.

(COMMERCIAL BREAK)

FOSTER: U.S. President Barack Obama is urging lawmakers to break recess to end the budget crisis, which has partially shut down the Federal Aviation Administration.

Here's what he said just a few moments ago.

FOSTER: U.S. President Barack Obama is urging lawmakers to break recess to end the budget crisis, which has partially shut down the Federal Aviation Administration.

Here's what he said just a few moments ago.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: This is a lose-lose- lose situation that can be easily solved if Congress gets back into town and does its job. And they don't even have to come back into town. The House and the Senate could, through a procedural agreement, basically do this through unanimous consent. And they can have the fights that they want to have when they get back. Don't put the livelihoods of thousands of people at risk. Don't put projects at risk. And don't let a billion dollars, at a time when we're scrambling for every dollar we can, get left on the table because Congress did not act.

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: (voice-over): For 10 days, 4,000 FAA employees have been furloughed and more than 200 airport construction projects stopped, putting an additional tens of thousands out of work.

Meanwhile, the FAA has been unable to collect taxes on airline ticket sales, losing $25 million each and every day.

RANDY BABBITT, FAA ADMINISTRATOR: I've been around this business a long time. I've never seen anything like this. And I find it appalling, candidly.

MESERVE: The FAA has not had a new budget authorized since 2007, but 20 extensions have kept the agency operating. The 21st, however, contains something new -- language inserts by House Republicans -- "cut off money subsidizing air travel to three rural airports in states with Democratic senators," including Nevada, the home of Senate Majority Leader Harry Reid.

REP. JOHN MICA (R), FLORIDA: Someone has to say no, no to wasteful spending, no to subsidies of $3,700 per ticket.

MESERVE: For days, the chambers have failed to compromise on the issue, much to the dismay of some members.

MESERVE: The underlying issue causing rancor between the parties, a labor ruling that favored union efforts to organize airlines. Republicans want to reverse it in the FAA authorization bill.

SEN. JAY ROCKEFELLER (D), WEST VIRGINIA: It's a tragedy about ego, about bullying, about an attempt to prove one side would cave.

MESERVE: (on camera): No one has caved yet. That leaves open the possibility that the FAA extension will not pass until mid-September. That would leave thousands out of work and result in $1.2 billion of lost revenue.

Jeanne Meserve, CNN, Washington.

(END VIDEO TAPE)

FOSTER: This week's debt ceiling compromise in Washington came with a political price. Weeks of bitter wrangling revealed just how deep the divisions run in Washington right now.

Meanwhile, Americans have already paid a financial price for all that drama leading up to the deadline.

Allan Chernoff explains.

(BEGIN VIDEOTAPE)

ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: Now that Congress and the president have finally agreed on a plan to raise the debt ceiling and the president has signed the bill, we know that the Treasury Department is going to be able to pay the government's bills. There will not be a default.

However, there is a cost to U.S. taxpayers. And the hard evidence, the hard numbers of that cost, the first numbers, have come out. They came out in the auction of Treasury bills today and yesterday. The government, of course, auctions off bills, notes and bonds to investors. That's how it borrows money from them. And what's been happening over the past couple of weeks is that investors have demanded higher interest rates, particularly for the short-term Treasury bills, because they've been worried that the government might possibly default.

So what has that cost been?

Well, have a look at the results of the auction. One-Month Treasury bills auctioned off today for an extra interest of $1 million. That's compared to two weeks ago, the extra interest that the U.S. government had to pay to sell these.

Add it all up and the cost to U.S. taxpayers, an extra $18.5 million. That's money that goes right on top of the deficit. It increases the deficit and it comes out of the pocket of U.S. taxpayers.

Allan Chernoff, CNN, New York.

(END VIDEO TAPE)

FOSTER: The three major credit rating agencies had warned that the U.S. may face a downgrade if the debt ceiling plan was not put in place. Now that it has, we've heard from two of those agencies. And Moody's says the U.S. will keep its AAA rating, but has issued a negative outlook. A downgrade could be triggered in the coming year if no new financial measures are adopted in 2013.

The country's outlook deteriorates significantly or government spending goes out of control.

Meanwhile, Fitch rating agency says the risk of sovereign debt remains extremely low, while the government is clearly a step in the right direction, the U.S. and in Europe must confront tough choices on taxes and spending if the deficit is to be cut to safer levels over the medium-term.

We -- well, we know there's a lot of junk on Twitter. And there's lots of conversation about the debt ceiling. So much of it's junk. But the QUEST MEANS BUSINESS team has sifted through to find the Tweets that will actually make you think.

It's Tweets from the Top. And today, they're all from the Western Hemisphere and the United States debt, dominates, of course.

And U.S. Senator Chuck Schumer Tweets: "With the debt ceiling behind us, it's now time for -- for Congress to focus like a laser on jobs."

Senator Schumer voted for the debt bill. But his Democratic counterpart did not, the other New York senator, Democrat Kirsten Gillibrand Tweeted: "This plan does nothing to address our jobs crisis yet calls for deep cuts to discretionary spending that favor the wealthy and corporations."

Finally, elsewhere, Venezuelan President Hugo Chavez is also talking economics. But he Tweets: "Right now, the strategic proposal to create the Bolivarian dollar has supreme value. Let's finish the Victor dollar (ph)."

So he's turning against the U.S. again.

You can get all the Tweets from the Top of this show at none other than Twitter.com/richardquest.

Right now, though, the weather with Jenny Harrison -- hi, Jenny.

JENNY HARRISON, CNN METEOROLOGIST: Hello, Max.

It's nice to see you over there.

At least you're in a nice little cool studio, unlike Mr. Quest the last couple of days.

But I have to tell you that conditions in Europe, they're cooling down a little bit. You can see all these clouds coming in. Now, there's an area of low pressure with a long front trailing down. And behind this, we have got the cooler air.

But coming in with it, some very strong thunderstorms. Again, look at this across Germany just in the last 12 hours. Almost the entire central and western regions seeing some form of rain. As I say, some thunderstorms in there. Some of them are pretty strong, as well. The same across the eastern regions of the UK.

But before the rain all came in, another view here from Broadstone. This is in Kent, probably one of the most eastern tips, actually, in the UK. And you can see everyone flocking off there to the beach.

And then be careful, it says on the side. Let's just have a go anyway. But obviously, there is a reason for the sign. But at the same time, it has been jolly warm across much of the UK.

Now, those strong thunderstorms, they're going to move eastwards. And as I say, there's rain coming in with them and then cooler air behind that system.

So a little bit warmer ahead, hence this particular area across the central regions where we might have some strong thunderstorms developing. You can see it is pulling out over the next couple of days on the forecast. So it's, meanwhile, staying pretty fine and dry across the southwest and generally fine, as well, through much of the Mediterranean.

So you can see that cooler air across the east, but there you can see also this cooler air coming in, as I say, behind that frontal system.

So what that means is when we get to Thursday, your high in London, 21 degrees Celsius, which is still a very respectable 70 degrees Fahrenheit, 23 across in Paris. And, of course, much warmer in the southwest, 36 Celsius there for you in Madrid.

Now, heading across the Atlantic, we are looking, of course, at Tropical Storm Emily. In the last few hours, beginning to lose a little bit of its circulation, trying to break up. These are the upper surface winds, which are actually doing their best across those upper regions to the north to actually break the system down. But it hasn't managed to do it quite yet. And certainly, look at the rain in just the last 12 hours across Puerto Rico.

But at least the storm system is now moving away from there. You can see we've got winds at about 80 kilometers an hour.

It's to the south-southwest of Santo Domingo right now in the Dominican Republic. And you can see here, it looks as if it's going to be heading across into Haiti, at which point, when it makes that interaction with the land, winds actually should begin to ease off.

But even so, the rains, which will come onto a whole other story. But the warnings are out, as you may expect, tropical storm warnings across all of Haiti, the Dominican Republic and also for much of the Bahamas and to the north, the northern sections of the Bahamas, we've got a tropical storm warning in place.

But you can see here on the forecast for the winds that there the system goes. It's actually quite to the south of the Dominican Republic. And then according to the actual wind forecast, it appears to really fall apart. A little bit more evident here on the Sat Rab (ph) that we are going to see that system once again reemerge across the eastern tips of Cuba. And that is at the point, of course, where, once again, it's over these warm waters and it could well pick up a little bit more strength.

But the rains are going to be torrential. The real danger is for flash floods, mudslides and landslides. We could easily see about 250 millimeters of rain in the Dominican Republic.

We will keep a very close eye on all of that -- Max.

FOSTER: Jenny, thank you very much, indeed.

Now, there's some work that you really wouldn't mind taking home with you. Richard Patterson certainly falls into that category. He is the mater blender for whiskey makers, Whyte & Mackay.

This is his World At Work.

(BEGIN VIDEO CLIP)

RICHARD PATTERSON, MASTER BLENDER, WHYTE & MACKAY: Swivel it around, bring it up, you say hello. Then you go back and you say, how are you?

Then you go back and say quite well, thank you very much.

Now, whiskey is very important to me, because it was running in my family. My grandfather and my father were whiskey blenders. So whiskey really runs in my blood.

What I normally do is I get up at four minutes past six in the morning. I'm in the office by, normally, about quarter past seven. I see what mail is on my desk. And then I go into my favorite place, my sample room.

So we pour it into the glass. You've got to swirl it around, make sure it's clean.

What do we do with it?

Throw it on the carpet. What it does is it actually cleans the lip of the glass. This is now ready for a session of whiskey.

How do you extract it?

Like this.

Um. Um, umm, umm. You've got to have not just 100 percent, 120 percent passion for your job. Um, um, um, um, um. You've got to love it. Um, um, um. You've got to get into it. But you've got to make it really good that you can share with all our people.

Hmmmm. Hello there.

I've been with Whyte & Mackay for 41 years now. And over that period, I've seen, what, nine takeovers, 17 different bosses. But my passion for whiskey has never diminished. I still love the spirit.

So when I look at this whiskey and I sip it, savor it, hold it long in my mouth, I think. Um, um, um-um, um-um.

You know, life isn't so bad.

(END VIDEO TAPE)

FOSTER: Well, he's happy.

The markets aren't quite so. We'll update you on them after the break.

(COMMERCIAL BREAK)

FOSTER: Just time to recap on the day's action on the markets.

And the losing streak continues here in Europe, with losses of around 2 percent or worse for the big three. There was not a single share that actually made gains on the DAX today.

The London FTSE and the Paris CAC closed at their lowest levels this year. Mining stocks and commodities really pulled the FTSE down. And as we were telling you earlier, SOFGEN led the way in terms of losses in Paris, though, with rivals, Credit Agricole, not far behind.

A slightly less grim view in the U.S. markets right now. The Dow started the day with sharp losses -- more than 100 points, in fact. But it's rebounded a little since then. It may even snap its eight day losing streak if it picks up in the last hour of trade. It's not been helped by some disappointing numbers on lay-offs that we mentioned earlier. We'll see a full jobs report on Friday, though.

Talk of new stimulus plans from three Fed governors may also have helped lighten the mood on Wall Street, still down today, but only just.

Now, Saudi Arabia is looking to top its neighbor, the United Arab Emirates. Plans were unveiled on Tuesday to build the world's the last skyscraper in the city of Jeddah. The project will cost more than a billion dollars and will take three years to complete, though there's no start date yet. Planned to be 1,000 meters tall, the Kingdom Tower would easily overshadow other skyscrapers. The Burj Khalifa in Dubai is currently the world's tallest building.